Quebec exports to grow for third year in a row with 7 per cent gain in 2012, predicts Export Development Canada

MONTREAL, Nov. 22, 2011 /CNW/ - Quebec's international exports are forecast to grow by another 7 per cent in 2012 after an estimated 4 per cent gain in 2011, according to a Global Export Forecast by Export Development Canada (EDC).

"The Canadian trend of diversifying into emerging markets is evident in Quebec with China expected to replace the U.K. this year as the province's number two export destination behind the U.S.," said Peter Hall., Chief Economist at EDC.

"In 2012, the aerospace sector will be the star performer, offsetting reduced growth from industrial products as the price effect begins to wear off. The beleaguered forestry sector will get a 9 per cent boost in 2012 thanks to rising momentum in U.S. homebuilding. The extraordinary financial and monetary conditions that are supporting record high prices for gold and other base metals will persist through next year, another boon to Quebec's 2012 export receipts."

The province's international export picture is led by four key sectors:

  • Industrial goods, accounting for 39 per cent of the province's total exports;
  • Machinery and Equipment, accounting for 13 per cent;
  • Forestry, accounting for 13 per cent; and
  • Transportation, accounting for 12 per cent.

The province's exports of industrial goods are forecast to rise by 6 per cent in 2012, on the heels of a 7 per cent increase in 2011. "Quebec's aluminum exports will be boosted by strong prices this year, however production will be flat this year and next with the only notable ramp up in production occurring at Rio Tinto's Laterrière smelter. Activity in the mining sector is booming, in large part because of an $80 billion government-led initiative to support mineral extraction in the northern regions (Plan Nord) and the development of Malartic and Sleeping Giant."

Quebec's machinery and equipment export sector is forecast to grow by 5 per cent in 2012, after a 5 per cent gain in 2011.  "Despite a downward revision to our U.S. growth outlook this year, investment activity in the private sector is driving export demand as record-high cash levels, improving business confidence and accelerated tax deductions for capital investment fuel higher spending by U.S. businesses," Hall said.

"Sales to emerging markets, though still a small share of overall sales, will continue to outpace those to developed markets throughout and beyond the forecast period."

EDC's forecast calls for Quebec's forestry sector exports to grow by 9 per cent in 2012 after two years of zero gains.

"Even though significant challenges like the strong Canadian dollar, overcapacity, high input costs, and increased overseas competition continue to pose a hurdle to companies within the Canadian forestry industry, there is some good news developing for 2012, Hall said. "Surging demand from emerging markets, particularly from China, is breathing new life into the wood products and pulp industry, and EDC's forecast for resumption in the U.S. housing market by the end of 2012 will be welcome news to the timber industry."

The transportation sector is forecast to grow 23 per cent in 2012 after a slight decline of 1 per cent in 2011. "The aerospace sector, which has been suffering from plunging demand and deferrals throughout the recession, is beginning to heat up with a rebound of orders and an increasing backlog of planes on the OEM's order book. The outlook for the U.S., the top export destination, will be fairly flat this year with few aircraft scheduled for delivery in 2011, but will return to growth next year as Bombardier's recently announced purchase agreement with NetJets for up to 120 new global aircraft signals a revival of demand in the business jet sector."

Canadian exports of goods and services are forecast to rise 11 per cent in 2011 and 7 per cent in 2012. Nationally, economic growth is expected to rise 2.3 per cent in 2011 and 2.4 per cent in 2012. EDC is forecasting global growth of 3.7 per cent in 2011 and 4.3 per cent in 2012.

EDC's semi-annual Global Export Forecast addresses the latest global export conditions including perspectives on interest rates, exchange rates as well as export strategies to help Canadian companies minimize risk. It also analyzes a range of risks for which exporters should be prepared. EDC's Global Export Forecast is available at http://www.edc.ca/gef.

B-Roll footage of Peter Hall's forecast comments available at: http://Exportwise.ca/listvideo_en.

EDC is Canada's export credit agency, offering innovative commercial solutions to help Canadian exporters and investors expand their international business. EDC's knowledge and partnerships are used by more than 8,200 Canadian companies and their global customers in up to 200 markets worldwide each year. EDC is financially self-sustaining and a recognized leader in financial reporting and economic analysis.

SOURCE Export Development Canada

For further information:

Media contacts:
Phil Taylor
Export Development Canada
Tel: 613.598.2904
BlackBerry: ptaylor@edc.ca


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